Document on Financial Services

Introduction

The brief for this project I was given was to look at my clients financial position in detail and make suggestions as to what he should invest in. Seamus is a 38 year old married man with four children all school going age. He earns an annual salary of €175000 with his wife earning €57000 a year as a primary teacher. His annual living expenses are approximately €90000 excluding mortgage and loan repayments. His residence was purchased for €695000 in 2003 and is currently valued at €380000. He has an outstanding mortgage of €467500 and has 18 years remaining. He has a variable rate on his mortgage with AIB currently 6.1%. He also has a long standing credit card bill of €6500 with AIB. He has savings of €62000 in his Rabo Direct deposit account and earns 1.2% interest gross of DIRT. He also holds 5000 shares in Greencore Plc purchased in 2003 at a cost of €23200. He has just inherited €150000 which he is looking to invest and seeks advice.

Objectives

The objectives are to review Seamus’ financial position and to try and find alternative financial products that would benefit Seamus’ overall position. Also Seamus is interested in looking into pension mortgages and it’s appropriateness to his situation. Seamus wants to invest his inheritance in property directly or indirectly. I have looked at Seamus’ profile and have made recommendations that I think will benefit him. He is a medium-high risk investor.

Assets and Liabilities

Tax:

Seamus:

Income | % Tax | Tax |

€41800 | 20% | €8360 |

€23800 | 20% | €4760 |

€109400 | 41% | €44854 |

€175000 | Total | €57974 |

Wife:

Income | % Tax | Tax |

€41800 | 20% | €8360 |

€15200 | 20% | €3040 |

| 41% | |

€57000 | Total | €11400 |

Rabo Direct deposit account:

He has savings of €62000 in his deposit account, his interest rate is 1.2% and the DIRT is 33%, this works out as:

62000/1.2 = 744

744/33 = 246

744-246 = 498

He earns €498 on his €62000 in his deposit account which is a poor...